Davivienda Manufacturing PMI for December 2025 Signals Moderation in Colombia’s Industrial Expansion
Key Takeaways: December 2025’s Davivienda Manufacturing PMI for Colombia registered 52.6, below market expectations of 54.1 and down from November’s 54.0. This marks a notable slowdown in manufacturing growth momentum after a strong late-2025 rebound. The reading remains above the 50 expansion threshold but signals softer output and new orders. External pressures, tighter monetary conditions, and cautious fiscal policy weigh on sentiment. Forward-looking risks include global trade uncertainties and domestic inflation dynamics.
Table of Contents
The Davivienda Manufacturing PMI for Colombia in December 2025 came in at 52.6, down from November’s 54.0 and missing the consensus estimate of 54.1, according to the latest data from the Sigmanomics database. This reading indicates continued expansion in the manufacturing sector but at a more moderate pace compared to the prior month. The PMI remains above the 50-point threshold that separates growth from contraction, signaling resilience amid a complex macroeconomic environment.
Geographic & Temporal Scope
The PMI covers Colombia’s manufacturing sector nationwide, reflecting output, new orders, employment, supplier delivery times, and inventories for December 2025. The comparison period is November 2025, with additional context drawn from October (52.0), September (55.3), and the 12-month average of approximately 52.9.
Core Macroeconomic Indicators
December’s PMI moderation aligns with broader macro trends. Colombia’s GDP growth slowed to an estimated 3.2% annualized rate in Q4 2025, down from 3.8% in Q3. Inflation remains elevated at 7.1% year-over-year, pressuring real incomes and consumer demand. Industrial production growth decelerated to 1.8% YoY in December from 3.0% in November, consistent with the PMI’s softer tone.
Monetary Policy & Financial Conditions
The Central Bank of Colombia maintained its policy rate at 12.25% in December 2025, signaling a cautious stance amid persistent inflationary pressures. Tighter financial conditions have begun to weigh on manufacturing investment and credit availability. The Colombian peso (COP) depreciated modestly against the USD in December, reflecting external uncertainties and capital outflows.
Fiscal Policy & Government Budget
Fiscal policy remains moderately restrictive. The government’s 2025 budget deficit narrowed to 3.5% of GDP, down from 4.1% in 2024, reflecting improved tax collection and expenditure controls. However, public investment growth slowed, limiting stimulus to the industrial sector. Ongoing reforms aim to balance fiscal consolidation with social spending.
External Shocks & Geopolitical Risks
Global trade tensions, particularly between major partners like the US and China, have introduced volatility in export demand. Commodity price fluctuations, especially in oil and metals, have impacted input costs for manufacturers. Regional geopolitical risks, including political uncertainty in neighboring countries, add to the cautious business sentiment.
This chart signals a sector trending upward but losing steam. The moderation in PMI suggests manufacturers are adjusting to tighter financial conditions and slower external demand. The softening in new orders and employment sub-indices warns of potential headwinds in early 2026, requiring close monitoring.
Market lens
Immediate reaction: COP/USD weakened 0.3% in the first hour post-release, reflecting disappointment versus expectations. Colombian equity futures (COLCAP) dipped 0.5%, while 2-year government bond yields rose 5 basis points, pricing in slower growth but persistent inflation risks.
Bullish Scenario
- PMI rebounds above 54.0 by Q2 2026 as global trade stabilizes and commodity prices firm.
- Monetary policy eases moderately in H2 2026, boosting credit and investment.
- Fiscal stimulus targets manufacturing innovation and infrastructure, lifting capacity.
Base Scenario
- PMI hovers between 51.5 and 53.5 through mid-2026, reflecting steady but modest expansion.
- Inflation remains sticky, limiting monetary easing and keeping borrowing costs elevated.
- External demand grows slowly amid geopolitical uncertainties.
Bearish Scenario
- PMI falls below 50 by Q3 2026, signaling contraction due to worsening global trade tensions.
- Monetary tightening persists as inflation spikes, further dampening manufacturing activity.
- Fiscal austerity deepens, reducing public investment and domestic demand.
Probabilities: Bullish 25%, Base 55%, Bearish 20%. The base case remains most likely given current data and policy signals.
December 2025’s Davivienda Manufacturing PMI reading of 52.6 highlights a cautious but ongoing expansion in Colombia’s manufacturing sector. The moderation from November’s stronger print reflects tightening monetary conditions, fiscal prudence, and external headwinds. While the sector remains resilient, risks from inflation persistence and global trade volatility warrant vigilance. Policymakers face a delicate balance between containing inflation and supporting growth. Investors should monitor PMI trends alongside inflation data and central bank communications for signals on Colombia’s economic trajectory in 2026.
Key Markets Likely to React to Davivienda Manufacturing PMI
The Davivienda Manufacturing PMI is a vital barometer of Colombia’s industrial health and economic momentum. Markets sensitive to growth and inflation dynamics typically respond swiftly to PMI releases. Key assets include the Colombian peso, local equity indices, and interest rate instruments. Additionally, global commodity-linked currencies and stocks with exposure to Latin American trade flows may also react.
- COPUSD – The primary currency pair reflecting Colombia’s trade and capital flows, sensitive to PMI-driven growth expectations.
- COLCAP – Colombia’s main equity index, which tracks domestic economic activity and investor sentiment.
- USDCOP – The inverse of COPUSD, also highly reactive to macroeconomic data.
- EC – Colombia’s largest oil company, sensitive to manufacturing demand and commodity price shifts.
- BTCUSD – While less directly correlated, Bitcoin’s risk sentiment often moves with emerging market economic data.
Since 2020, the Davivienda Manufacturing PMI and COLCAP index have shown a positive correlation, with PMI expansions often preceding equity rallies. This relationship underscores the PMI’s role as a leading indicator for Colombia’s market cycles.
FAQs
- What does the Davivienda Manufacturing PMI measure?
- The PMI gauges manufacturing sector health by surveying output, new orders, employment, and supplier deliveries.
- How does the PMI affect Colombia’s economy?
- It signals industrial growth trends, influencing monetary policy, investment decisions, and market sentiment.
- Why did the December 2025 PMI decline?
- Slower new orders, tighter credit, and external trade uncertainties contributed to the moderation.
Key takeaway: December’s PMI signals ongoing but slower manufacturing growth, highlighting the need for balanced policy to sustain Colombia’s economic momentum into 2026.
Updated 1/2/26
This has been drafted with AI assistance and then thoroughly reviewed, refined, and approved by our human editorial team to ensure accuracy, and originality.
The December 2025 PMI reading of 52.6 represents a decline from November’s 54.0 and October’s 52.0, yet remains above the 12-month average of 52.9. This indicates a reversal of the two-month upward trend seen in September (55.3) and November (54.0), suggesting a moderation in manufacturing growth momentum heading into 2026.
New orders and production sub-indices both softened, with new orders dipping to 51.8 from 54.5 in November. Employment growth slowed to 50.5, barely above the expansion threshold, reflecting cautious hiring amid uncertain demand. Supplier delivery times lengthened slightly, pointing to ongoing supply chain frictions.